Brief
Tasty Gallos says R1.35 million cash alone won’t secure a franchise
Founder Muhammed Gutta stresses business experience and active involvement over pure capital for new franchisees.
By Felo News Desk · Published
Founder and CEO Muhammed Gutta of South Africa’s Tasty Gallos franchise says that while R1.35 million in unencumbered cash can get an applicant past the first stage of the application, it does not guarantee a restaurant licence.
What happened
The chicken‑restaurant chain, launched in 2020, has made franchisee selection a central part of its growth plan. Gutta now assesses candidates on business experience, additional income streams and the intention to be actively involved in day‑to‑day operations, rather than relying solely on the ability to fund the initial investment.
What the reports add
According to the article, the shift reflects a broader challenge in South Africa’s entrepreneurial climate. The Global Entrepreneurship Monitor reports early‑stage entrepreneurial activity rose from 11 % of adults in 2023 to 15 % in 2025, while established business ownership fell from 6 % to 4 % in the same period. Gutta argues that a failed outlet harms the franchisor’s brand, management resources and future expansion.
What was said
“Anyone can sell you a restaurant, especially an established franchised business. I want to know whether you'll still be running it in five years, because that’s what makes the franchise sustainable, and that’s the only version of this model that will work for both of us,” Gutta told Bizcommunity.
“Selling another restaurant may grow the network on paper but placing it with the wrong operator can create problems for years. That puts more responsibility on us to make the right call at the beginning. We learnt that the hard way,” he added.
How it came about
When Tasty Gallos began, capital was the primary selection criterion. Experience showed that cash alone did not predict long‑term success, prompting the revised criteria that now prioritize durability of the franchise network.
Key facts
- R1.35 million cash can clear the first stage of a Tasty Gallos franchise application (bizcommunity.com)
- Muhammed Gutta now evaluates applicants on experience, income streams and active involvement (bizcommunity.com)
- South Africa’s early‑stage entrepreneurial activity rose to 15 % of adults in 2025 (bizcommunity.com)
- Established business ownership in South Africa fell to 4 % in 2025 (bizcommunity.com)
Sources
- [1] bizcommunity.com — originally reported as “Why R1. 35m isn’t enough to secure a Tasty Gallos franchise”
